Section 1. Amend §3573(2), Title 12, of the Delaware Code by inserting between the word "liable" and the period (".") the phrase "to the extent of such claim against such transferor or other person for whom such transferor is or was vicariously liable".
Section 2. Amend §3570(10)b.6. by deleting subparagraph 6. in its entirety and substituting in lieu thereof the following:
"6. The transferor's potential or actual receipt or use of principal if such potential or actual receipt or use of principal would be the result of a qualified trustee's or qualified trustees' acting: (i) in such qualified trustee's or qualified trustees' discretion, (ii) pursuant to a standard that governs the distribution of principal and does not confer upon the transferor a substantially unfettered right to the receipt or use of the principal or (iii) at the direction of an adviser described in paragraph (9)c. of this section who is acting (a) in such adviser's discretion or (b) pursuant to a standard that governs the distribution of principal and does not confer upon the transferor a substantially unfettered right to the receipt of or use of principal. For purposes of this paragraph, a qualified trustee is presumed to have discretion with respect to the distribution of principal unless such discretion is expressly denied to such trustee by the terms of the trust instrument.".
Section 3. Amend §3572, Title 12 of the Delaware Code by adding thereto a new subsection (g) to read as follows:
"(g) If, any action brought against a trustee of a trust that is the result of a qualified disposition, a court takes any action whereby such court declines to apply the law of this state in determining the validity, construction or administration of such trust, or the effect of a spendthrift provision thereof, such trustee shall immediately upon such court's action and without the further order of any court, cease in all respects to be trustee of such trust and a successor trustee shall thereupon succeed as trustee in accordance with the terms of the trust instrument or, if the trust instrument does not provide for a successor trustee and the trust would otherwise be without a trustee, the Court of Chancery, upon the application of any beneficiary of such trust, shall appoint a successor trustee upon such terms and conditions as it determines to be consistent with the purposes of such trust and this statute. Upon such trustee's ceasing to be trustee, such trustee shall have no power or authority other than to convey the trust property to the successor trustee named in the trust instrument in accordance with this Section.".
Section 4. Amend §3570, Title 12, of the Delaware Code by substituting the word "person" for the word "individual" in subsection (9), paragraph d. thereof wherever the same shall appear.
Section 5. Amend §3572, Title 12 of the Delaware Code by substituting the section number "3570(9)c" for "3570(8)c" in subsection (e) thereof.
Section 6. This Act shall be effective upon enactment and shall apply to trusts whenever created.
Approved June 30, 2003